AAR CORP (AIR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AIR - US0003611052 - Common Stock
97.03 USD
+2.3 (+2.43%)
97.35 USD
+0.32 (+0.33%)
We assign a fundamental rating of 4 out of 10 to AIR. AIR was compared to 71 industry peers in the Aerospace & Defense industry. There are concerns on the financial health of AIR while its profitability can be described as average. AIR has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
AIR had positive earnings in the past year.
AIR had a positive operating cash flow in the past year.
Each year in the past 5 years AIR has been profitable.
AIR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
AIR has a Return On Assets of 2.90%. This is comparable to the rest of the industry: AIR outperforms 54.93% of its industry peers.
AIR has a Return On Equity (6.03%) which is comparable to the rest of the industry.
AIR has a Return On Invested Capital of 8.32%. This is in the better half of the industry: AIR outperforms 70.42% of its industry peers.
AIR had an Average Return On Invested Capital over the past 3 years of 7.36%. This is in line with the industry average of 8.54%.
The 3 year average ROIC (7.36%) for AIR is below the current ROIC(8.32%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.9% | ||
| ROE | 6.03% | ||
| ROIC | 8.32% |
ROA(3y)2.32%
ROA(5y)2.84%
ROE(3y)4.33%
ROE(5y)4.83%
ROIC(3y)7.36%
ROIC(5y)6.95%
1.3 Margins
The Profit Margin of AIR (3.17%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of AIR has grown nicely.
AIR's Operating Margin of 9.40% is in line compared to the rest of the industry. AIR outperforms 57.75% of its industry peers.
AIR's Operating Margin has improved in the last couple of years.
The Gross Margin of AIR (19.29%) is worse than 66.20% of its industry peers.
In the last couple of years the Gross Margin of AIR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.4% | ||
| PM (TTM) | 3.17% | ||
| GM | 19.29% |
OM growth 3Y14.65%
OM growth 5Y34.25%
PM growth 3Y-52.86%
PM growth 5Y16.72%
GM growth 3Y3.32%
GM growth 5Y7.87%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AIR is destroying value.
AIR has more shares outstanding than it did 1 year ago.
The number of shares outstanding for AIR has been increased compared to 5 years ago.
AIR has a better debt/assets ratio than last year.
2.2 Solvency
A Debt/Equity ratio of 0.61 indicates that AIR is somewhat dependend on debt financing.
AIR has a worse Debt to Equity ratio (0.61) than 66.20% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | N/A | ||
| Altman-Z | N/A |
ROIC/WACC0.81
WACC10.28%
2.3 Liquidity
A Current Ratio of 2.84 indicates that AIR has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 2.84, AIR is in line with its industry, outperforming 56.34% of the companies in the same industry.
A Quick Ratio of 1.31 indicates that AIR should not have too much problems paying its short term obligations.
AIR has a Quick ratio (1.31) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.84 | ||
| Quick Ratio | 1.31 |
3. Growth
3.1 Past
AIR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.72%, which is quite impressive.
AIR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.75% yearly.
The Revenue has grown by 15.40% in the past year. This is quite good.
Measured over the past years, AIR shows a small growth in Revenue. The Revenue has been growing by 6.06% on average per year.
EPS 1Y (TTM)26.72%
EPS 3Y17.57%
EPS 5Y12.75%
EPS Q2Q%31.11%
Revenue 1Y (TTM)15.4%
Revenue growth 3Y15.17%
Revenue growth 5Y6.06%
Sales Q2Q%15.92%
3.2 Future
The Earnings Per Share is expected to grow by 16.18% on average over the next years. This is quite good.
Based on estimates for the next years, AIR will show a small growth in Revenue. The Revenue will grow by 1.07% on average per year.
EPS Next Y15.63%
EPS Next 2Y16.51%
EPS Next 3Y16.18%
EPS Next 5YN/A
Revenue Next Year15.84%
Revenue Next 2Y13.09%
Revenue Next 3Y10.44%
Revenue Next 5Y1.07%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
AIR is valuated rather expensively with a Price/Earnings ratio of 22.00.
Compared to the rest of the industry, the Price/Earnings ratio of AIR indicates a rather cheap valuation: AIR is cheaper than 92.96% of the companies listed in the same industry.
AIR's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.19.
With a Price/Forward Earnings ratio of 18.33, AIR is valued on the expensive side.
Based on the Price/Forward Earnings ratio, AIR is valued cheaply inside the industry as 95.77% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.92, AIR is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22 | ||
| Fwd PE | 18.33 |
4.2 Price Multiples
92.96% of the companies in the same industry are more expensive than AIR, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 13.96 |
4.3 Compensation for Growth
AIR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AIR has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as AIR's earnings are expected to grow with 16.18% in the coming years.
PEG (NY)1.41
PEG (5Y)1.73
EPS Next 2Y16.51%
EPS Next 3Y16.18%
5. Dividend
5.1 Amount
No dividends for AIR!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
97.03
+2.3 (+2.43%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners97.11%
Inst Owner Change0.05%
Ins Owners1.93%
Ins Owner Change-3.41%
Market Cap3.84B
Revenue(TTM)2.97B
Net Income(TTM)94.10M
Analysts83.64
Price Target92.48 (-4.69%)
Short Float %3.12%
Short Ratio3.44
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.54%
Min EPS beat(2)8.56%
Max EPS beat(2)12.52%
EPS beat(4)4
Avg EPS beat(4)9.23%
Min EPS beat(4)1.68%
Max EPS beat(4)14.17%
EPS beat(8)8
Avg EPS beat(8)6.1%
EPS beat(12)12
Avg EPS beat(12)5.83%
EPS beat(16)16
Avg EPS beat(16)5.59%
Revenue beat(2)2
Avg Revenue beat(2)4.89%
Min Revenue beat(2)3.46%
Max Revenue beat(2)6.33%
Revenue beat(4)3
Avg Revenue beat(4)3.31%
Min Revenue beat(4)-3.93%
Max Revenue beat(4)7.38%
Revenue beat(8)5
Avg Revenue beat(8)1.98%
Revenue beat(12)8
Avg Revenue beat(12)2.39%
Revenue beat(16)11
Avg Revenue beat(16)2.09%
PT rev (1m)2.64%
PT rev (3m)4.12%
EPS NQ rev (1m)-0.36%
EPS NQ rev (3m)-2.44%
EPS NY rev (1m)-0.29%
EPS NY rev (3m)1.02%
Revenue NQ rev (1m)1.59%
Revenue NQ rev (3m)8.72%
Revenue NY rev (1m)1.43%
Revenue NY rev (3m)5.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22 | ||
| Fwd PE | 18.33 | ||
| P/S | 1.29 | ||
| P/FCF | N/A | ||
| P/OCF | 2741.79 | ||
| P/B | 2.46 | ||
| P/tB | 5.38 | ||
| EV/EBITDA | 13.96 |
EPS(TTM)4.41
EY4.54%
EPS(NY)5.29
Fwd EY5.46%
FCF(TTM)-0.84
FCFYN/A
OCF(TTM)0.04
OCFY0.04%
SpS75.02
BVpS39.46
TBVpS18.04
PEG (NY)1.41
PEG (5Y)1.73
Graham Number62.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.9% | ||
| ROE | 6.03% | ||
| ROCE | 10.53% | ||
| ROIC | 8.32% | ||
| ROICexc | 8.56% | ||
| ROICexgc | 12.77% | ||
| OM | 9.4% | ||
| PM (TTM) | 3.17% | ||
| GM | 19.29% | ||
| FCFM | N/A |
ROA(3y)2.32%
ROA(5y)2.84%
ROE(3y)4.33%
ROE(5y)4.83%
ROIC(3y)7.36%
ROIC(5y)6.95%
ROICexc(3y)7.68%
ROICexc(5y)7.26%
ROICexgc(3y)10.94%
ROICexgc(5y)9.53%
ROCE(3y)9.32%
ROCE(5y)8.8%
ROICexgc growth 3Y18.86%
ROICexgc growth 5Y36.52%
ROICexc growth 3Y7.16%
ROICexc growth 5Y28.07%
OM growth 3Y14.65%
OM growth 5Y34.25%
PM growth 3Y-52.86%
PM growth 5Y16.72%
GM growth 3Y3.32%
GM growth 5Y7.87%
F-Score7
Asset Turnover0.92
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.82 | ||
| Cap/Depr | 58.74% | ||
| Cap/Sales | 1.17% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 0.41% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.84 | ||
| Quick Ratio | 1.31 | ||
| Altman-Z | N/A |
F-Score7
WACC10.28%
ROIC/WACC0.81
Cap/Depr(3y)80.23%
Cap/Depr(5y)64.82%
Cap/Sales(3y)1.34%
Cap/Sales(5y)1.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)26.72%
EPS 3Y17.57%
EPS 5Y12.75%
EPS Q2Q%31.11%
EPS Next Y15.63%
EPS Next 2Y16.51%
EPS Next 3Y16.18%
EPS Next 5YN/A
Revenue 1Y (TTM)15.4%
Revenue growth 3Y15.17%
Revenue growth 5Y6.06%
Sales Q2Q%15.92%
Revenue Next Year15.84%
Revenue Next 2Y13.09%
Revenue Next 3Y10.44%
Revenue Next 5Y1.07%
EBIT growth 1Y65.62%
EBIT growth 3Y32.05%
EBIT growth 5Y42.38%
EBIT Next Year47.08%
EBIT Next 3Y22.53%
EBIT Next 5YN/A
FCF growth 1Y-217.73%
FCF growth 3Y-71.08%
FCF growth 5YN/A
OCF growth 1Y-97.72%
OCF growth 3Y-21.7%
OCF growth 5YN/A
AAR CORP / AIR FAQ
What is the ChartMill fundamental rating of AAR CORP (AIR) stock?
ChartMill assigns a fundamental rating of 5 / 10 to AIR.
What is the valuation status of AAR CORP (AIR) stock?
ChartMill assigns a valuation rating of 4 / 10 to AAR CORP (AIR). This can be considered as Fairly Valued.
Can you provide the profitability details for AAR CORP?
AAR CORP (AIR) has a profitability rating of 6 / 10.
How financially healthy is AAR CORP?
The financial health rating of AAR CORP (AIR) is 4 / 10.
What is the expected EPS growth for AAR CORP (AIR) stock?
The Earnings per Share (EPS) of AAR CORP (AIR) is expected to grow by 15.63% in the next year.